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The Origin of Government

Economic means must precede political means; production must precede consumption; how prehistoric economies led to the origin of government.

Economic means must precede political means. That axiom by Tom Palmer explains why there are no governments among primitive societies. They have leaders but never a state. Hunter-gatherers and nomads don’t generate enough of an economic surplus to support a permanent predator class. Nonetheless, such societies were victimized by roving bandits (precursors of government) who moved on once they plundered what little was available. There was no reason for them to stay. Also nomads and hunters were not stationary and hence not easy targets for predators.

Everything changed once people settled permanently and established agriculture. Now they generated a regular economic surplus and were vulnerable because they had to remain in one location. Once again, roving bandits came, pillaged and plundered. However, the bandits were not stupid; they grasped the opportunity. Now there was a reason for them to stay and to plunder permanently. Hence, roving bandits morphed into stationary bandits who, through sheer force, subjugated the people and kept out other roving bandits. They thereby acquired and enforced a monopoly on physical violence within a given territory and, voila, government was created.

The etiology is clear enough. An economic surplus is an a priori condition for the existence of a state. Government cannot exist without entrepreneurs; they have to build it before government can plunder it. Without those who invest, take risks and build businesses, government could not exist. Even the earliest farmers had to invest (plant seeds, tend crops) and take risks (drought, pestilence) while the now-permanent bandits did nothing constructive and often imposed obstacles to hinder productivity.

Things are no different today. Permanent bandits, who now sanctimoniously go by titles such as kings, emperors, presidents and prime ministers, plunder through their enforced monopoly on violence. America is little different simply because our rulers govern with the pro forma consent of the governed. They call themselves mayor, governor, congressman or president but they behave like the bandits of yore. They plunder from the rest of us to enrich themselves in many ways – licit and illicit.

Some like Barack Obama (“You didn’t build that”) and Hillary Clinton (“Businesses don’t create jobs”) have the sheer chutzpah to claim government is the source of economic success. Even barbarians of prehistoric times clad in animal skins would have found that absurd; lacking economic knowledge, they nevertheless understood that plunderers did not help the plundered create their businesses. They also viscerally understood Say’s Law that production must always precede consumption, i.e. there was nothing to be plundered until someone produced something.

We might even be better off today with the bandits of ancient times. Sometimes they got sated and left us alone. Some grasped that plundering less today caused the economy to grow faster so they could plunder more tomorrow, thus benefiting both plunderers and plunderees. Bandits understood imposing arbitrary rules, regulations and creating uncertainty was counterproductive to the amount of plunder. Our current crop of stationary bandits never gets sated and is less enlightened than its ancient barbarian predecessors who stormed down from the steppes of Central Asia.